LONDON, UK, December 7, 2004 -- Even with the advent of health
awareness campaigns to draw attention to the health problems
associated with diabetes, the global* prevalence of diabetes is
expected to climb to over 50 million by 2012.

However a new report by independent market analyst Datamonitor
expects significant developments in the field of diabetes therapy.
According to the report, by 2012, at least three new key classes of
drugs to treat diabetes will have entered the market, with the most
promising being Novartis's LAF-237 and Eli Lilly's exenatide LAR.
According to Datamonitor forecasts, both drugs will acquire
blockbuster status by 2012, amassing total sales in excess of $3
billion, says Datamonitor Endocrinology analyst Nick
Karachalias.

Huge societal cost

Datamonitor estimates that there are 38 million diabetic people
in the US, Japan, France, Germany, Italy, Spain and the UK, with
almost half residing in the U.S. Despite increasing health
awareness campaigns and attempts to slow down the startling
increase in diabetes rates, Datamonitor predicts that the
prevalence of diabetes will increase to over 50 million by 2012,
Karachalias says. "Health complications and comorbidities
associated with diabetes are a huge drain on national health
services around the world. Based on statistics from an ADA
(American Diabetes Association) report, in 2002, the direct medical
and indirect expenditures in the US attributable to diabetes were
estimated at $132 billion."

Despite the presence of well tried and liked compounds for the
treatment of diabetes (insulin, metformin and sulfonylureas) and
the recent introduction of new classes such as thiazolidinediones
(TZDs), alpha glucosidase inhibitors (AGIs) and prandial glucose
regulators (PGRs), there are still important unmet needs in the
treatment of diabetes. Due to the high unmet need, diabetes
represents a lucrative market for R&D investment, Karachalias
says. "Datamonitor has identified seven new classes of compounds
currently under development. Of these classes, three present the
most interest, Glucagon-Like Peptide -1 (GLP-1) agonists,
Dipeptidyl Peptidase IV (DPPIV) inhibitors and dual Peroxisome
Proliferator Activator Receptor (PPAR) agonists."

New drugs promising

Two of the most promising drugs in the pharmaceutical pipeline
are Eli Lilly's exenatide and exenatide LAR, which are expected to
be launched in 2005 and 2007, respectively. The drugs belong to the
class of GLP-1 agonists, have been successful in clinical trials
for diabetes and appear to have a good safety profile. The main
issue with these agents is their mode of administration, namely
they will have to be injected, Karachalias says. "This fact may
pose a problem with the uptake of exenatide and the subsequent
patient compliance to therapy. However, exenatide LAR promises to
solve this problem with its long acting release formulation, which
means that the patients will only have to inject themselves with
the agent once per week or once per month."

Another very promising drug in the pipeline is LAF-237, which is
being developed by Novartis and is currently undergoing Phase III
trials. LAF-237 belongs to the class of DPPIV inhibitors and is
exploiting the same basic biochemical pathway as GLP-1 agonists.
However, its main difference and main advantage is the fact that
unlike GLP-1, it can be orally administered, Karachalias says.
"This fact is expected to boost its uptake and benefit patient
compliance. It is predicted that LAF-237 will be launched by
2007..."

Lifestyle changes needed

"Although the influx of new drug classes is definitely good news
for both pharmaceutical companies and diabetics, none of the new
drugs will be the answer to the growing diabetes problem. Lifestyle
changes are still needed in order to prevent the development of the
disease and slow its progression. The development of even more
potent agents, with the ability to maintain their efficacy over
prolonged periods of time, with excellent safety and side-effects
profiles will remain crucial to combating diabetes," he says.

Dual PPAR agonists were once hailed as the next big development
in the treatment of diabetes. However the recent withdrawal of many
leading agents following safety concerns has prompted the FDA to
request additional safety data before considering the approval of
any such compounds, Karachalias says. "This development will
severely delay the progress of dual PPAR analogs. As a result even
the leading compound in this class, BMS and Merck and Co's
muraglitazar is not expected to exceed $500m of peak sales."

*Global in this case refers to the seven major pharmaceutical
markets: UK, U.S., Japan, Italy, Germany, France and Spain.